The Clean Energy Incentive Program (CEIP) is a provision in the Clean Power Plan that awards allowances to states for early action to invest in renewable energy, such as wind and solar, as well as low-income energy efficiency projects. Notably, double credits will be awarded for low-income energy efficiency projects that reduce end-use energy demand in 2020 and 2021. Such projects must result in quantified and verified electricity savings (measured in MWh) through demand-side energy efficiency measures implemented in a low-income community.
Fresh Energy is urging the Minnesota Pollution Control Agency to include participation in the CEIP in Minnesota’s State Implementation Plan through five targeted recommendations.
1) Low-income Definition
Establish a “low-income” definition that builds from existing Minnesota programs, such as the LIRC Assessor Report used by Minnesota Housing and supported by the Division of Energy Resources for the administration of low-income programs under the Conservation Improvement Program (CIP).
Census data could also be utilized to identify low-income communities more broadly. The Small Area Income and Poverty Estimates (SAIPE) program, for example, produces single-year estimates of median household income and poverty for states and all counties. The SAIPE program could allow a standardized method of determining whether a particular community is low-income.
2) Spend beyond existing low-income requirements
Each utility has a minimum dollar amount that must be spent on low-income programs each year. To receive double credits for early action under the CEIP, that utility low-income efficiency projects should be in addition to the statutory low-income minimum spending requirements.
Another notable opportunity for new CEIP investments is in the area of multifamily housing. Multifamily housing efficiency investments serve the highest number of residents per project, and thus provide significant energy savings potential. Therefore, multifamily housing is a valuable sector for new investments in low-income energy efficiency projects.
3) Eligible Projects
The Minnesota Technical Resource Manual lists savings measures that are likely eligible for multifamily housing projects (such as lighting, appliances, insulation, etc), which tend to serve a disproportionate number of low-income residents.
Though these measures are identified as eligible for multifamily housing, Fresh Energy recommends that these measures should be automatically included in the CEIP for efficiency, as multifamily housing efficiency projects serve a disproportionate number of low-income residents.
4) Process and Prioritization of CEIP Credits
The state should adopt a Request for Proposal process to implement CEIP projects and award more credits to projects that maximize low-income participation. Further, PCA should urge EPA to allocate a greater number of CEIP credits to low-income energy efficiency projects.
Fresh Energy supports the State’s comments regarding the eligibility dates for CEIP projects. An earlier eligibility date would further encourage the early action promoted in the CEIP and increase the number of projects that could contribute to the overall CO2 emissions reductions sought in the Clean Power Plan.
5) Low-income Community Solar Projects
Community solar projects in low-income communities, which would provide direct customer benefit through zero-carbon renewable energy and bill stabilization, can meet both goals of the CEIP. Community solar reduces subscribers’ utility bills through steadier energy costs, a benefit that is especially valuable to low-income households. Further, community solar could reduce uncollectible expenses, which benefits all ratepayers.
There are a number of ways to design community solar CEIP eligibility criteria. For example, if a certain percentage (e.g., 60 percent) of subscribers to a community solar garden met a low income definition, the garden could quality for CEIP credits.